Earlier last week, we saw that the Fed will in fact not slow down their bond buying program at the current moment. Although it does affect mortgage rates, this bond buying is part of a larger stimulus package that is gearing itself towards helping increase the national economy. Over the previous few years, Orlando real estate has seen some of the lowest mortgage rates on the 30 year mortgage that it has ever seen. Just the thought alone of the bond buying program coming to a screeching halt has impacted the rates over the previous few months to skyrocket, causing many to be priced out of purchasing their Orlando home.
So now that Ben Bernanke and the gang are still going to be purchasing these bonds, what does that mean for Orlando Real Estate? What can we expect from the mortgage rates in Central Florida moving forward?
What could possibly happen if they actively reduced bond purchases?
Shown straight from Bankrate.com:
“The Fed could have caused rates to shoot up this week if it had announced the tapering of its bond-purchasing program.”
What exactly could this mean to Orlando Real Estate buyers looking for a mortgage approval?
“For now, borrowers have dodged another spike in rates. The Fed's announcement might even cause rates to drop in coming days, says Paul Edelstein, director of financial economics at IHS Global Insight.
‘Mortgage rates should fall back -- not massively, but to some extent,’ he says.
That doesn't mean homebuyers and homeowners should wait for lower rates, mortgage professionals say.
Eventually, once the Fed lets the mortgage market and the economy start walking on their own, rates will probably head back to the 5 percent or 6 percent range, says Scott Schang, manager for Broadview Mortgage Katella in Orange, Calif."
When can we expect the feds to start slowing down their bond buying processes?
According to an article in theWall Street Journal:
“Federal Reserve policy makers decided this week that the economy isn't in the right place for them to start winding down their bond-buying program. By the time they meet in December, it might be.
The decision to not start winding down the bond-buying program now was close… The economy only needs to get a little bit better over the next few months for the central bank to get its nerve back. That should be an easy bar for the economy to clear.”
As you can tell from this last paragraph, by December we could be looking at the chance of them deciding to slow down the process. All this means for real estate buyers in Central Florida is that buying now will not only save you money, but will save you in the long run with the mortgage rates. As the market increases dramatically over the previous few months, we can only imagine that it will continue to move in this positive direction at a seemingly rapid pace. The faster you purchase your home, the better in this instance.
The same goes for selling your Orlando real estate. Although many individuals are currently wanting to "wait" until prices rise again; which could more than likely occur, it would be better to put that for sale sign up now as compared to later. Central Florida homes for sale are increasing daily to new highs, and the competition is becoming more and more fierce. The longer you wait, the more likely that another home will join the already growing list.
Orlando Property Group is here to help you with your real estate needs in Orlando and we want to see you get the most for your home while finding that new
one that fits your every need. Contact us today and let us create a free CMA so you can see how much your Orlando real estate is worth.